ASC shipbuilding is stop by 2019 if there’s no new work, chair Bruce Carter says

EXCLUSIVE: ASC shipbuilding will cease to exist by 2019 without work, chair Bruce Carter has told The Advertiser.

• 600 construction jobs to be created for Osborne South naval shipyard
• Naval shipbuilding to reap $134.4 billion for SA
• ASC to build non-combat ships for export

ASC shipbuilding will cease to exist by 2019 without work, chair Bruce Carter has told The Advertiser.

Mr Carter, one of the state’s most prominent businessmen and one who is usually reticent about speaking publicly, says the Adelaide workforce had been “ridiculed” in the past but is now up to speed.

However, the team is at risk of being disbanded amid doubts over whether the shipbuilding side of ASC will be involved in ­future projects.

While the Federal Government says there will be plenty of jobs, Mr Carter says it’s the team — from cleaners to board members — that matters.

The HMAS Hobart, a Hobart-class air warfare destroyer built in Adelaide, moored at the Garden Island naval base in Sydney in October. Picture: AFP / William West

ASC shipbuilding is hoping for work on export contracts and the Offshore Patrol Vessels but neither of those are certain. The big upcoming project is the $30 billion Future Frigates project, but tender documents make it clear ASC as a brand will not necessarily be part of it.

Mr Carter had described the workforce as “among the most publicly ridiculed or maligned in the nation”.

Former Defence Minister David Johnston infamously said he would not trust ASC to build a canoe.

But Mr Carter said “in the face of that criticism and adversity the performance of both the submarine and the shipbuilding business have been turned around”.

The Air Warfare Destroyers’ productivity levels are ­hitting world standards while the Collins Class submarine sustainment has been taken off the Government’s projects of concern list.

Mr Carter said splitting the team would not deliver the same results.

The ASC shipyards in Osborne.

“The outcome for our workforce in the shipbuilding business is that unless we have more work by the end of 2019 then we don’t have a business,” he said.

“The outcome of that is you lose something that the nation has invested heavily in. We will do our level best for that not to occur.”

All three tenderers for the Future Frigates have said they will use workers from ASC — in fact, a major concern is whether there will be enough workers. But Mr Carter said it was about the team.

“There’s no other first-world nation that, having estab­lished a shipbuilding capacity, would then bring in foreigners,” he said.

Defence Industry Minister Christopher Pyne outlined a range of recent announcements about jobs in the industry and said the Government would soon make more announcements about job opportunities for ASC workers.

The air warfare destroyer HMAS Hobart leaves Adelaide for its new home in Sydney in August. Picture: AAP / Brenton Edwards

“The biggest issue facing our naval shipbuilding industry is a shortage of skilled workers,” he said.

“Every skilled worker at Osborne can expect to gain a role in this massive, $90 billion expansion of the Australian navy.”

Mr Pyne said the Government had worked “tirelessly” to fill the so-called Valley of Death, where workers are lost as the AWD project slows down, making it hard to get numbers up again for future projects.

He said the OPV and frigates projects would create 5200 jobs, “with more than double that in the supply chain”.

The way forward

ASC – originally the Australian Submarine Corporation – recently was divided into three parts; submarine sustainment, shipbuilding, and infrastructure.

The shipbuilding component depends on the workflow, which is drying up as work on the Air Warfare Destroyers is finished. ASC chair Bruce Carter says ASC needs work in the pipeline to continue.

It is seeking work on three fronts:

FUTURE FRIGATES

The $30 billion Future Frigates are the big fish. ASC teamed with Austal to offer a shipbuilding solution to the three foreign contenders for the project – the UK’s BAE, Italy’s Fincantieri, and Spain’s Navantia. But a Request for Tender from Defence makes it clear that those companies can leave the ASC/Austal team completely out of it.

OPVs

ASC is bidding for the $3 billion Offshore Patrol Vessels contract. One bid is with German shipbuilders Lurssen; another with Danish shipbuilders Damen.

They are competing against WA shipbuilders Austal, who have partnered with German shipbuilders Fassmer.

EXPORTS

ASC is in discussions over exporting both naval and coast guard ships, which could maintain hundreds of jobs.